Money - Exponential and Logarithmic Functions

[LocoBoy12315]

Part 2: Use logarithms to measure information in the following problems. The “Rule of 70” gives the approximate time ? that it takes for an amount of money invested at an annual interest rate of ?% to double in value: ? = ?? ? .

1. Write the compound interest formula for a principal ?, an annual interest rate ?, and a time ?, with ?? as the final value of the investment.

2. Solve the equation you wrote in #1 for ? by taking “ln” of both sides. Use the approximation: ??(? + ?) ≈ ?, valid for small values of ?.

 

[Deleted member 4993]

Part 2: Use logarithms to measure information in the following problems. The “Rule of 70” gives the approximate time ? that it takes for an amount of money invested at an annual interest rate of ?% to double in value: ? = ?? ? .

1. Write the compound interest formula for a principal ?, an annual interest rate ?, and a time ?, with ?? as the final value of the investment.

2. Solve the equation you wrote in #1 for ? by taking “ln” of both sides. Use the approximation: ??(? + ?) ≈ ?, valid for small values of ?.

Please share your work/thoughts about this problem.